Step 06 · Family and obligations
When a household's income, care arrangements or loan repayments depend on one person, their death may leave a substantial financial gap. Term life insurance pays the agreed sum to the beneficiary if the insured person dies during the policy term, subject to the policy terms and exclusions.
It is not intended to treat illness or build savings. Its purpose is to reduce a previously identified financial gap following death.
If the insured person dies during the agreed policy term, the death benefit is paid to the named beneficiary. It can help fund living costs, childcare, education or outstanding loans.
Term life insurance must be distinguished from an endowment life policy. It focuses on death benefit protection and generally has no savings component payable at the end of the term.
The insured person, the policyholder and the person entitled to receive the benefit are different roles and must be set correctly.
The key question is whether a person's death would create a financial gap that could not be closed through other income, statutory entitlements or existing assets.
Unpaid care and household work also have financial value. Both partners may therefore need their own protection.
A suitable death benefit can help meet an outstanding property loan or another long-term financial obligation.
Where ownership, guarantees or finance depend on individual people, a death can create commercial obligations as well.
One parent provides a substantial part of the household income and contributes to the shared property loan. If that person dies during the policy term, the agreed benefit can help fund ongoing obligations and family care.
Illustrative example only — not personal advice and not a guarantee of cover, benefits or price.The sum insured, policy term and contractual roles must work together. We assess them alongside existing entitlements and obligations.
Income, care, loans, savings and existing survivor benefits are considered together.
The period is aligned with the obligation being protected instead of using a blanket duration.
Level and decreasing sums are compared according to the protection objective.
Policyholder, insured person and beneficiary are structured transparently.
Requested health and risk circumstances are prepared carefully and completely.
Birth, separation, loan repayment, sale or business changes can trigger a new review.
Death, loss of ability to work and property damage trigger different benefits and should be planned separately.
Anyone who keeps a motor vehicle needs motor liability insurance. The next page also explains how partial and fully comprehensive cover and other modules apply to the insured vehicle.
This page provides general information and does not replace personal advice or assessment of a particular policy. Benefits, exclusions, term and beneficiary rights are governed by the application, policy schedule, German law and policy conditions.
